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The Dow Jones 30 inches higher as investors await the Fed's policy meeting. A short squeeze above the September high at 32600 has put the bears on the defensive. Heightened volatility shows that wrong-footed traders were looking to bail out. As the index climbs back towards August’s high, 33100 at the origin of a previous sell-off is the next hurdle. The RSI’s overbought condition may trigger profit-taking and a pullback from this demand-turned-supply area. 31900 is the first level to gauge the strength of follow-up bids.

Silver slips as the dollar index recoups recent losses. The price has stabilised over the daily support and psychological level of 18.00. A series of higher highs led sellers to cover their positions. The market is in a post-swing consolidation until a breakout on either side lifts momentum once again. 19.60 is the immediate resistance and its breach could carry the precious metal to the previous peak around 20.80. 18.80 is a fresh support and the zone between 18.00 and 18.30 is a critical floor to keep the current rebound intact.

The euro retreats over muted GDP growth in the eurozone. The price action is hovering around parity in an attempt to hold onto its recent gains, a sign of the bulls’ strong attachment to this symbolic level. The selling pressure has waned after the pair closed above 0.9990, which could shift short-term bias to the upside. 0.9850 next to the MA cross on the daily chart is an area of congestion. A bounce above 1.0010 might resume the recovery towards September’s high at 1.0180. 0.9710 is the bulls’ second line of defence.

Daily Pivots: (S1) 169.91; (P) 171.02; (R1) 171.70; More...

GBP/JPY retreated after hitting 172.11 and intraday bias is turned neutral first. Downside of retreat should be contained above 164.95 support to bring another rally. Break of 172.11 will resume larger up trend and target 100% projection of 148.93 to 165.69 from 159.71 at 176.47 next.

In the bigger picture, up trend from 123.94 (2020 low), as part of the trend from 122.75 (2016 low) is still in progress. Further rise would be seen to 161.8% projection of 122.75 to 156.59 (2018 high) from 123.94 at 178.69. This will now remain the favored case as long as 148.93 support holds.

Daily Pivots: (S1) 146.55; (P) 147.16; (R1) 147.60; More....

Intraday bias in EUR/JPY stays neutral as consolidation from 148.38 is extending. In case of another fall, downside should be contained 140.88/144.06 support zone to bring another rally. Break of 148.38 will resume larger up trend to 100% projection of 133.38 to 145.62 from 137.32 at 149.56, which is close to 149.76 long term resistance.

In the bigger picture, the up trend from 114.42 (2020 low) is still in progress for 149.76 (2014 high). Decisive break there will pave the way to 161.8% projection of 114.42 to 134.11 from 124.37 at 156.22. This will now remain the favored case as long as 137.32 support holds.

Daily Pivots: (S1) 0.8585; (P) 0.8606; (R1) 0.8638; More...

EUR/GBP is losing downside momentum but further decline is expected with 0.8779 resistance intact. Current decline from 0.9267 should target 0.8201/8388 support zone. However, break of 0.8770 will turn bias back to the upside for 0.8869 resistance and above.

In the bigger picture, current development suggests that fall from 0.9267 is a down leg inside long term range pattern. Deeper fall could be seen towards 0.8201/8338 support zone. But strong support should be seen there to bring reversal.

Daily Pivots: (S1) 1.5403; (P) 1.5485; (R1) 1.5529; More...

EUR/AUD is extending the consolidation from 1.5704 and intraday bias remains neutral. Deeper decline cannot be ruled out. But downside should be contained by 55 day EMA (now at 1.5172) to bring rebound. On the upside, break of 1.5704 will resume the rally from 1.4281.

In the bigger picture, a medium term bottom should be in place at 1.4281, on bullish convergence condition in daily MACD. Further rise would be seen back to 1.6434 key resistance next. Break of 1.4965 resistance turned support is needed to indicate reversal. Otherwise, further rally will remain in favor.

Daily Pivots: (S1) 0.9875; (P) 0.9908; (R1) 0.9936; More....

Intraday bias in EUR/CHF stays neutral as consolidation from 0.9953 is extending. In case of another fall, downside should be contained by 0.9798 support to bring rebound. On the upside, break of 0.9953 will resume the rise from 0.9407 to 100% projection of 0.9407 to 0.9798 from 0.9641 at 1.0032.

In the bigger picture, a medium term bottom should be in place at 0.9407. Further rally is expected as long as 0.9641 support holds, even as a corrective rebound. Next target 38.2% retracement of 1.1149 to 0.9407 at 1.0072. Reaction from there, as well as 55 week EMA (now at 1.0128) will reveal whether the trend is reversing.

ECB President Christine Lagarde said in an interview, "Inflation is still far too high in the euro area as a whole... Higher energy and food prices are still the main drivers of price increases. We are increasingly seeing that these higher energy costs are feeding through to more and more sectors in the economy."

"We expect to raise interest rates further to make sure that inflation returns to our medium-term target of 2% in a timely manner," she added.

"Since July we have raised interest rates by 200 basis points – the fastest increase in the history of the euro," she said. "But we are not done yet. We will decide on future policy steps meeting by meeting, each time assessing how the outlook for the economy and inflation has evolved, also considering how the measures we have taken so far are working."

She admitted that the "likelihood of a recession has increased and uncertainty remains high." But ultimately, "persistently high inflation rates are more damaging to society because they make everybody poorer."

Full interview here.

Daily Pivots: (S1) 0.9849; (P) 0.9908; (R1) 0.9942; More...

EUR/USD is staying above 0.9847 minor support and intraday bias remain neutrals first. Further rise is in favor as long as 0.9847 minor support holds. Break of 1.0092 will target 38.2% retracement of 1.1494 to 0.9534 at 1.0283. However, break of 0.9847 will turn bias back to the downside for 0.9534/9630 support zone instead.

In the bigger picture, the case of medium term bottoming at 0.9534 building up, with bullish convergence condition in daily MACD. While it is too early to call for trend reversal, firm break of 0.9998 opens up stronger rebound back to 55 week EMA (now at 1.0630) even as a corrective rise. However, sustained trading back below 55 day EMA (now at 0.9938) will revive medium term bearishness for another fall through 0.9534 low.